EX-99.1 2 dex991.htm PRESS RELEASE DATED MAY 2, 2007 Press Release dated May 2, 2007

Exhibit 99.1

 

LOGO    News Release

Sunoco, Inc.

1735 Market Street

Philadelphia, Pa. 19103-7583

 

For further information contact    For release: IMMEDIATELY

Jerry Davis (media) 215-977-6298

Tom Harr (investors) 215-977-6764

  

No.         

SUNOCO REPORTS FIRST QUARTER RESULTS

PHILADELPHIA, May 2, 2007 — Sunoco, Inc. (NYSE: SUN) today reported net income of $175 million ($1.44 per share diluted) for the first quarter of 2007 versus $79 million ($0.59 per share diluted) for the first quarter of 2006. Excluding special items, income was $85 million ($0.70 per share diluted) for the current quarter. There were no special items in the first quarter of 2006.

“While refining margins and operating income were improved versus last year’s comparable period, our results were significantly limited by the major turnaround and expansion work at our Philadelphia refinery,” said John G. Drosdick, Sunoco Chairman and Chief Executive Officer. “This $520 million project reduced first-quarter refinery production by approximately nine million barrels and also contributed to higher average crude oil costs and the sale of low-valued residual fuel inventory. The timing of this downtime and its associated impacts occurred during the part of the quarter when margins in the Northeast were at their highest levels. Also in the Northeast, a loss of steam from a power outage at a third-party supplier resulted in an unplanned shutdown of the Marcus Hook refinery in February that reduced throughput by an additional one million barrels.

“With the recent completion of the Philadelphia turnaround and fluid catalytic cracking unit expansion project,” continued Drosdick, “our Northeast refining system is now returning to normal operations as we enter the summer driving season. In addition to the expansion of the catalytic cracking unit’s capacity from 70 to 85 thousand barrels per day, we expect the project will provide us with the ability to upgrade an additional 15-20 thousand barrels per day of low-value residual fuel oil into higher-value gasoline and distillate products and demonstrate the increased earnings power of these assets.”

 

- more -


SUNOCO 1Q07 EARNINGS, PAGE 2

 

Commenting on other 2007 capital projects in Refining and Supply, Drosdick said, “Final tie-in work for the crude unit debottleneck project at our Toledo refinery is scheduled to begin in May with completion anticipated by the end of the quarter. We estimate that the work will result in only a minimal reduction in crude throughput during the quarter. In addition, our Tulsa refinery is currently scheduled to undergo a maintenance turnaround beginning in June, which is expected to reduce second quarter production at the facility by approximately 2.4 million barrels. Following the completion of this work, we have no major turnaround activity scheduled for the remainder of the year, providing the opportunity to capture what we believe will continue to be a constructive market for refined product margins.”

DETAILS OF FIRST QUARTER RESULTS

REFINING AND SUPPLY

Refining and Supply earned $76 million in the first quarter of 2007 versus $73 million in the first quarter of 2006. The increase in earnings was due to higher realized margins, particularly in the MidContinent, essentially offset by lower production volumes and higher expenses. The lower volumes were mainly the result of work related to the project to expand capacity of a fluid catalytic cracking unit at the Philadelphia refinery as well as a one-week outage at the Tulsa refinery and unscheduled downtime at the Marcus Hook refinery due to a power outage at a third-party steam supplier. The completion of the work at the Philadelphia refinery is expected to reduce April production by approximately two million barrels. The higher expenses were largely the result of costs associated with the turnaround and expansion work and operating costs to produce low-sulfur fuels.

RETAIL MARKETING

Retail Marketing earned $7 million in the first quarter of 2007 versus break-even results in the first quarter of 2006. The increase in earnings was primarily due to higher average retail gasoline and distillate margins. Partially offsetting these positive factors were a $3 million after-tax charge associated with a litigation settlement and a $4 million after-tax decrease in divestment gains attributable to the Retail Portfolio Management program. Monthly gasoline and diesel throughput per company-owned or leased outlet increased approximately eight percent versus the first quarter of 2006.

CHEMICALS

Chemicals earned $9 million in the first quarter of 2007 versus $14 million in the prior-year period. The decrease in earnings was due primarily to lower margins and sales volumes for both phenol and polypropylene, partially offset by lower expenses. Lower volumes resulted in part from feedstock availability issues related to the turnaround work at Sunoco’s Philadelphia refinery and the power outage at a third-party steam supplier for Sunoco’s Marcus Hook refinery during the quarter.

 

- more -


SUNOCO 1Q07 EARNINGS, PAGE 3

 

LOGISTICS

Earnings for the Logistics segment were $9 million in the first quarter of 2007 versus $6 million in the first quarter of 2006. The increase was largely due to higher earnings from terminalling operations and from the Partnership’s acquisitions completed in 2006, partially offset by lower crude oil acquisition and marketing results and Sunoco’s reduced ownership in the Partnership subsequent to a public equity offering in the second quarter of 2006.

COKE

The Coke business earned $11 million in the first quarter of 2007 versus $14 million in the first quarter of 2006. The decrease in earnings was due primarily to higher costs and lower selling prices at the Jewell coal operations. In the first quarter of 2007, limited operations commenced at a 1.7 million tons-per-year cokemaking facility in Vitória, Brazil, with full production expected in mid-2007. The Coke business is the operator and has a one-percent ownership interest in this joint venture.

CORPORATE AND OTHER

Corporate administrative expenses were $15 million after tax in the first quarter of 2007 versus $16 million in the first quarter of 2006.

Net financing expenses were $12 million after tax in both first-quarter periods. Lower interest income and higher interest expense were offset by higher capitalized interest and lower expenses attributable to the preferential return of third-party investors in Sunoco’s cokemaking operations.

SPECIAL ITEM

During the first quarter of 2007, Sunoco recognized a $90 million after-tax gain related to the prior issuance of limited partnership units of Sunoco Logistics Partners L.P. (NYSE: SXL) to the public. Sunoco currently has a 43 percent interest in Sunoco Logistics Partners L.P., which includes its 2 percent general partnership interest.

Sunoco, Inc., headquartered in Philadelphia, PA, is a leading manufacturer and marketer of petroleum and petrochemical products. With 900,000 barrels per day of refining capacity, nearly 4,700 retail sites selling gasoline and convenience items, approximately 5,500 miles of crude oil and refined product owned and operated pipelines and 38 product terminals, Sunoco is one of the largest independent refiner-marketers in the United States. Sunoco is a significant manufacturer of petrochemicals with annual sales of approximately five billion pounds, largely chemical intermediates used to make fibers, plastics, film and resins. Utilizing a unique, patented technology, Sunoco’s cokemaking facilities in the United States also have the capacity to manufacture over 2.5 million tons annually of high-quality metallurgical-grade coke for use in the steel industry.

 

- more -


SUNOCO 1Q07 EARNINGS, PAGE 4

 

Anyone interested in obtaining further insights into the first quarter’s results can monitor the Company’s quarterly teleconference call, which is scheduled for 3:00 p.m. ET on May 3, 2007. It can be accessed through Sunoco’s Web site - www.SunocoInc.com. It is suggested that you visit the site prior to the teleconference to ensure that you have downloaded any necessary software.

Those statements made in this release that are not historical facts are forward-looking statements intended to be covered by the safe harbor provisions of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. Although Sunoco believes that the assumptions underlying these statements are reasonable, investors are cautioned that such forward-looking statements are inherently uncertain and necessarily involve risks that may affect Sunoco’s business prospects and performance, causing actual results to differ materially from those discussed in the foregoing release. Such risks and uncertainties include, by way of example and not of limitation: general economic, financial and business conditions which could affect Sunoco’s financial condition and results of operations; changes in competition and competitive practices, including the impact of foreign imports; effects of weather conditions and natural disasters on the Company’s operating facilities and on product supply and demand; changes in refining, marketing and chemical margins; variation in petroleum-based commodity prices and availability of crude oil and feedstock supply or transportation; effects of transportation disruptions; changes in the price differentials between light-sweet and heavy-sour crude oils; changes in the marketplace which may affect supply and demand for Sunoco’s products; changes in the level of capital expenditures or operating expenses; changes in product specifications; availability and pricing of ethanol; changes in the expected level of environmental capital, operating or remediation expenditures; age of, and changes in, the reliability, efficiency and capacity of, the Company’s operating facilities or those of third parties; effects of adverse events relating to the operation of the Company’s facilities and to the transportation and storage of hazardous materials (including equipment malfunction, explosions, fires, spills, and the effects of severe weather conditions); risks related to labor relations and workplace safety; changes in, or new, statutes and government regulations or their interpretations, including those relating to the environment and global warming; changes in tax laws or their interpretations, including pension funding requirements; ability to identify acquisitions, execute them under favorable terms and integrate them into the Company’s existing businesses; ability to enter into joint ventures and other similar arrangements under favorable terms; delays and/or costs related to construction, improvements and/or repairs of facilities (including shortages of skilled labor, the issuance of applicable permits and inflation); nonperformance or force majeure by, or disputes with, major customers, suppliers, dealers, distributors or other business partners; changes in financial markets impacting pension expense and funding requirements; political and economic conditions in the markets in which the Company, its suppliers or customers operate, including the impact of potential terrorist acts and international hostilities; military conflicts between, or internal instability in, one or more oil producing countries, governmental actions and other disruptions in the ability to obtain crude oil; and changes in the status

 

- more -


SUNOCO 1Q07 EARNINGS, PAGE 5

 

of, or initiation of new, litigation, arbitration or other proceedings to which the Company is a party or liability resulting from such litigation, arbitration or other proceedings, including natural resource damage claims. These and other applicable risks and uncertainties have been described more fully in Sunoco’s 2006 Form 10-K filed with the Securities and Exchange Commission on February 26, 2007 and in other periodic reports filed with the Securities and Exchange Commission. Sunoco undertakes no obligation to update any forward-looking statements in this release, whether as a result of new information or future events.

-END OF TEXT, CHARTS FOLLOW-

 

- more -


SUNOCO 1Q07 EARNINGS, PAGE 6

 

Sunoco, Inc.

2007 First Quarter Financial Summary

(Unaudited)

 

First Quarter

   2007    2006

Revenues

   $ 9,305,000,000    $ 8,593,000,000

Net Income

   $ 175,000,000    $ 79,000,000

Earnings Per Share of Common Stock:

     

Basic

   $ 1.44    $ .59

Diluted

   $ 1.44    $ .59

Weighted-Average Number of Shares Outstanding (In Millions):

     

Basic

     121.4      132.9

Diluted

     121.7      133.6

 

- more -


SUNOCO 1Q07 EARNINGS, PAGE 7

 

Sunoco, Inc.

Earnings Profile of Sunoco Businesses (after tax)

(Millions of Dollars, Except Per-Share Amounts)

(Unaudited)

 

    

Three Months
Ended

March 31

       
     2007     2006     Variance  

Refining and Supply

   $ 76     $ 73     $ 3  

Retail Marketing

     7       —         7  

Chemicals

     9       14       (5 )

Logistics

     9       6       3  

Coke

     11       14       (3 )

Corporate and Other:

      

Corporate expenses

     (15 )     (16 )     1  

Net financing expenses and other

     (12 )     (12 )     —    
                        
     85       79       6  

Special items

     90       —         90  
                        

Consolidated net income

   $ 175     $ 79     $ 96  
                        

Earnings per share of common stock (diluted):

      

Income before special items

   $ .70     $ .59     $ .11  

Special items

     .74       —         .74  
                        

Net income

   $ 1.44     $ .59     $ .85  
                        

 

- more -


SUNOCO 1Q07 EARNINGS, PAGE 8

 

Sunoco, Inc.

Financial and Operating Statistics (Unaudited)

 

    

For the Three

Months Ended

March 31

     2007    2006

TOTAL REFINING AND SUPPLY

     

Income (Millions of Dollars)

   $ 76    $ 73

Realized Wholesale Margin* (Per Barrel of Production Available for Sale)

   $ 6.98    $ 6.13

Crude Inputs as Percent of Crude Unit Rated Capacity

     85      93

Throughputs (Thousand Barrels Daily):

     

Crude Oil

     761.5      835.3

Other Feedstocks

     79.4      68.8
             

Total Throughputs

     840.9      904.1
             

Products Manufactured (Thousand Barrels Daily):

     

Gasoline

     401.4      427.6

Middle Distillates

     285.4      308.1

Residual Fuel

     61.1      70.8

Petrochemicals

     34.4      35.8

Lubricants

     12.9      13.2

Other

     75.8      85.4
             

Total Production

     871.0      940.9

Less: Production Used as Fuel in Refinery Operations

     39.7      44.3
             

Total Production Available for Sale

     831.3      896.6
             

 

* Wholesale sales revenue less related cost of crude oil, other feedstocks, product purchases and terminalling and transportation divided by production available for sale.

 

- more -


SUNOCO 1Q07 EARNINGS, PAGE 9

 

Sunoco, Inc.

Financial and Operating Statistics (Unaudited)

 

    

For the Three

Months Ended

March 31

     2007    2006

Northeast Refining*

     

Realized Wholesale Margin (Per Barrel of Production Available for Sale)

   $ 5.25    $ 5.35

Market Benchmark 6-3-2-1 (Per Barrel)

   $ 7.14    $ 4.49

Crude Inputs as Percent of Crude Unit Rated Capacity

     82      93

Throughputs (Thousand Barrels Daily):

     

Crude Oil

     539.1      610.1

Other Feedstocks

     69.5      60.2
             

Total Throughputs

     608.6      670.3
             

Products Manufactured (Thousand Barrels Daily):

     

Gasoline

     289.3      319.2

Middle Distillates

     210.1      230.2

Residual Fuel

     57.4      66.4

Petrochemicals

     25.6      28.9

Other

     44.7      51.6
             

Total Production

     627.1      696.3

Less: Production Used as Fuel in Refinery Operations

     28.2      32.5
             

Total Production Available for Sale

     598.9      663.8
             

*  Comprised of the Marcus Hook, Philadelphia and Eagle Point refineries.

     

MidContinent Refining*

     

Realized Wholesale Margin (Per Barrel of Production Available for Sale)

   $ 11.42    $ 8.38

Market Benchmark 3-2-1 (Per Barrel)

   $ 11.06    $ 7.92

Crude Inputs as Percent of Crude Unit Rated Capacity

     91      92

Throughputs (Thousand Barrels Daily):

     

Crude Oil

     222.4      225.2

Other Feedstocks

     9.9      8.6
             

Total Throughputs

     232.3      233.8
             

 

* Comprised of the Toledo and Tulsa refineries.

 

- more -


SUNOCO 1Q07 EARNINGS, PAGE 10

 

Sunoco, Inc.

Financial and Operating Statistics (Unaudited)

 

    

For the Three

Months Ended

March 31

 
     2007     2006  

MidContinent Refining (continued)

    

Products Manufactured (Thousand Barrels Daily):

    

Gasoline

     112.1       108.4  

Middle Distillates

     75.3       77.9  

Residual Fuel

     3.7       4.4  

Petrochemicals

     8.8       6.9  

Lubricants

     12.9       13.2  

Other

     31.1       33.8  
                

Total Production

     243.9       244.6  

Less: Production Used as Fuel in Refinery Operations

     11.5       11.8  
                

Total Production Available for Sale

     232.4       232.8  
                

RETAIL MARKETING

    

Income (Millions of Dollars)

   $ 7     $ —    

Retail Margin* (Per Barrel):

    

Gasoline

   $ 3.48     $ 2.85  

Middle Distillates

   $ 6.84     $ 5.02  

Sales of Petroleum Products (Thousand Barrels Daily):

    

Gasoline

     299.3       287.5  

Middle Distillates

     46.9       46.5  
                
     346.2       334.0  
                

Total Retail Gasoline Outlets, End of Period

     4,683       4,737  

Gasoline and Diesel Throughput per Company Owned or Leased Outlet (M Gal/Site/Month)

     142       132  

Convenience Stores:

    

Total Stores, End of Period

     736       739  

Merchandise Sales (M$/Store/Month)

   $ 76     $ 71  

Merchandise Margin (Company Operated) (% of Sales)

     26 %     28 %
                

 

* Retail sales price less related wholesale price and terminalling and transportation costs per barrel. The retail sales price is the weighted-average price received through the various branded marketing distribution channels.

 

- more -


SUNOCO 1Q07 EARNINGS, PAGE 11

 

Sunoco, Inc.

Financial and Operating Statistics (Unaudited)

 

    

For the Three

Months Ended

March 31

     2007    2006

CHEMICALS

     

Income (Millions of Dollars)

   $ 9    $ 14

Margin* (Cents per Pound):

     

All Products**

     10.5      10.9

Phenol and Related Products

     8.8      9.1

Polypropylene**

     12.7      13.2

Sales (Millions of Pounds):

     

Phenol and Related Products

     592      633

Polypropylene

     548      562

Other

     20      21
             
     1,160      1,216
             

 

*       Wholesale sales revenue less cost of feedstocks, product purchases and related terminalling and transportation divided by sales volumes.

 

**     The polypropylene and all products margins include the impact of a long-term supply contract with Equistar Chemicals, L.P. which is priced on a cost-based formula that includes a fixed discount.

LOGISTICS

     

Income (Millions of Dollars)

   $ 9    $ 6

Pipeline and Terminal Throughput (Thousand Barrels Daily)*:

     

Unaffiliated Customers

     1,168      1,027

Affiliated Customers

     1,566      1,630
             
     2,734      2,657
             

 

*  Excludes joint-venture operations.

COKE*

     

Income (Millions of Dollars)

   $ 11    $ 14

Coke Production (Thousands of Tons)

     642      631
             

 

*  Includes amounts attributable to the facility in Vitória, Brazil which commenced limited operations in March 2007.

 

- more -


SUNOCO 1Q07 EARNINGS, PAGE 12

 

Sunoco, Inc.

Financial and Operating Statistics (Unaudited)

 

    

For the Three

Months Ended

March 31

 
     2007    2006  

CAPITAL EXPENDITURES (Millions of Dollars)

     

Refining and Supply

   $ 270    $ 130  

Retail Marketing

     13      12  

Chemicals

     14      11  

Logistics

     18      16 *

Coke

     17      3  
               
   $ 332    $ 172  
               

 

*  Excludes the acquisition of two separate crude oil pipeline systems and related storage facilities located in Texas, one from Alon USA Energy, Inc. for $68 million and the other from Black Hills Energy, Inc. for $41 million.

     

DEPRECIATION, DEPLETION AND AMORTIZATION (Millions of Dollars)

     

Refining and Supply

   $ 56    $ 56  

Retail Marketing

     26      25  

Chemicals

     19      18  

Logistics

     9      9  

Coke

     5      4  
               
   $ 115    $ 112  
               

 

- more -


SUNOCO 1Q07 EARNINGS, PAGE 13

 

Sunoco, Inc.

Earnings Profile of Sunoco Businesses (after tax)

(Millions of Dollars, Except Per-Share Amounts)

(Unaudited)

 

     2006  
     1st     2nd     3rd     4th     Total  

Refining and Supply

   $ 73     $ 409     $ 273     $ 126     $ 881  

Retail Marketing

     —         10       77       (11 )     76  

Chemicals

     14       8       5       16       43  

Logistics

     6       12       7       11       36  

Coke

     14       10       9       17       50  

Corporate and Other:

          

Corporate expenses

     (16 )     (11 )     (11 )     (20 )     (58 )

Net financing expenses and other

     (12 )     (12 )     (9 )     (16 )     (49 )
                                        
     79       426       351       123       979  

Special items

     —         —         —         —         —    
                                        

Consolidated net income

   $ 79     $ 426     $ 351     $ 123     $ 979  
                                        

Earnings per share of common stock (diluted):

          

Income before special items

   $ .59     $ 3.22     $ 2.76     $ 1.00     $ 7.59  

Special items

     —         —         —         —         —    
                                        

Net income

   $ .59     $ 3.22     $ 2.76     $ 1.00     $ 7.59  
                                        

 

- more -


SUNOCO 1Q07 EARNINGS, PAGE 14

 

Sunoco, Inc.

Earnings Profile of Sunoco Businesses (after tax)

(Millions of Dollars, Except Per-Share Amounts)

(Unaudited)

 

    

2007

First Quarter

 

Refining and Supply

   $ 76  

Retail Marketing

     7  

Chemicals

     9  

Logistics

     9  

Coke

     11  

Corporate and Other:

  

Corporate expenses

     (15 )

Net financing expenses and other

     (12 )
        
     85  

Special Items

     90  
        

Consolidated net income

   $ 175  
        

Earnings per share of common stock (diluted):

  

Income before special items

   $ .70  

Special items

     .74  
        

Net income

   $ 1.44  
        

 

- more -


SUNOCO 1Q07 EARNINGS, PAGE 15

 

Sunoco, Inc.

Consolidated Statements of Income

(Millions of Dollars)

(Unaudited)

 

     2006  
     1st     2nd     3rd     4th     Total  

REVENUES

          

Sales and other operating revenue (including consumer excise taxes)

   $ 8,569     $ 10,575     $ 10,480     $ 9,012     $ 38,636  

Interest income

     10       8       11       5       34  

Other income, net

     14       7       5       19       45  
                                        
     8,593       10,590       10,496       9,036       38,715  
                                        

COSTS AND EXPENSES

          

Cost of products sold and operating expenses

     7,454       8,858       8,867       7,768       32,947  

Consumer excise taxes

     628       663       679       664       2,634  

Selling, general and administrative expenses

     210       210       215       246       881  

Depreciation, depletion and amortization

     112       114       115       118       459  

Payroll, property and other taxes

     34       31       33       27       125  

Interest cost and debt expense

     26       27       25       27       105  

Interest capitalized

     (1 )     (4 )     (5 )     (6 )     (16 )
                                        
     8,463       9,899       9,929       8,844       37,135  

Income before income tax expense

     130       691       567       192       1,580  

Income tax expense

     51       265       216       69       601  
                                        

Net income

   $ 79     $ 426     $ 351     $ 123     $ 979  
                                        

 

- more -


SUNOCO 1Q07 EARNINGS, PAGE 16

 

Sunoco, Inc.

Consolidated Statements of Income

(Millions of Dollars)

(Unaudited)

 

    

2007

First Quarter

 

REVENUES

  

Sales and other operating revenue (including consumer excise taxes)

   $ 9,135  

Interest income

     5  

Other income, net

     165  
        
     9,305  
        

COSTS AND EXPENSES

  

Cost of products sold and operating expenses

     7,988  

Consumer excise taxes

     641  

Selling, general and administrative expenses

     221  

Depreciation, depletion and amortization

     115  

Payroll, property and other taxes

     37  

Interest cost and debt expense

     35  

Interest capitalized

     (9 )
        
     9,028  

Income before income tax expense

     277  

Income tax expense

     102  
        

Net income

   $ 175  
        

 

- more -


SUNOCO 1Q07 EARNINGS, PAGE 17

 

Sunoco, Inc.

Consolidated Balance Sheets

(Millions of Dollars)

(Unaudited)

 

    

At

March 31

2007

  

At

December 31

2006

ASSETS

     

Current Assets

     

Cash and cash equivalents

   $ 222    $ 263

Accounts and notes receivable, net

     2,439      2,440

Inventories

     981      1,219

Deferred income taxes

     93      93
             

Total Current Assets

     3,735      4,015

Investments and long-term receivables

     130      129

Properties, plants and equipment, net

     6,580      6,365

Deferred charges and other assets

     462      473
             

Total Assets

   $ 10,907    $ 10,982
             

LIABILITIES AND SHAREHOLDERS’ EQUITY

     

Current Liabilities

     

Accounts payable and accrued liabilities

   $ 4,035    $ 4,174

Short-term borrowings

     330      275

Current portion of long-term debt

     4      7

Taxes payable

     233      299
             

Total Current Liabilities

     4,602      4,755

Long-term debt

     1,752      1,705

Retirement benefit liabilities

     524      523

Deferred income taxes

     889      829

Other deferred credits and liabilities

     529      477

Minority interests

     452      618

Shareholders’ equity

     2,159      2,075
             

Total Liabilities and Shareholders’ Equity

   $ 10,907    $ 10,982
             

 

- more -


SUNOCO 1Q07 EARNINGS, PAGE 18

 

Sunoco, Inc.

Consolidated Statements of Cash Flows

(Millions of Dollars)

(Unaudited)

 

    

For the Three Months

Ended March 31

 
     2007     2006  

INCREASES (DECREASES) IN CASH AND CASH EQUIVALENTS

    

CASH FLOWS FROM OPERATING ACTIVITIES:

    

Net income

   $ 175     $ 79  

Adjustments to reconcile net income to net cash provided by (used in) operating activities:

    

Gain related to issuance of Sunoco Logistics Partners L.P. limited partnership units

     (151 )     —    

Depreciation, depletion and amortization

     115       112  

Deferred income tax expense

     92       17  

Payments less than expense for retirement plans

     11       4  

Changes in working capital pertaining to operating activities, net of effect of acquisitions

     (22 )     (518 )

Other

     17       (7 )
                

Net cash provided by (used in) operating activities

     237       (313 )
                

CASH FLOWS FROM INVESTING ACTIVITIES:

    

Capital expenditures

     (332 )     (172 )

Acquisitions

     —         (109 )

Proceeds from divestments

     6       12  

Other

     (3 )     (1 )
                

Net cash used in investing activities

     (329 )     (270 )
                

CASH FLOWS FROM FINANCING ACTIVITIES:

    

Net proceeds from short-term borrowings

     55       —    

Net proceeds from issuance of long-term debt

     48       115  

Repayments of long-term debt

     (4 )     (2 )

Cash distributions to investors in cokemaking operations

     (7 )     (4 )

Cash distributions to investors in Sunoco Logistics Partners L.P.

     (13 )     (10 )

Cash dividend payments

     (30 )     (27 )

Purchases of common stock for treasury

     —         (48 )

Proceeds from issuance of common stock under management incentive plans

     4       1  

Other

     (2 )     —    
                

Net cash provided by financing activities

     51       25  
                

Net decrease in cash and cash equivalents

     (41 )     (558 )

Cash and cash equivalents at beginning of period

     263       919  
                

Cash and cash equivalents at end of period

   $ 222     $ 361  
                

-END OF SUNOCO 1Q07 EARNINGS REPORT-